France has raised last-minute objections to a deal over the Lockerbie plane bombing with a demand for more compensation from Libya in the separate downing of a French plane.
Libya agreed on Wednesday to set up a $2.7 billion (£1.7 billion sterling) fund for families of victims of the 1988 attack over Lockerbie, Scotland, in a landmark deal that could thaw relations with the West and reopen the door to foreign investment.
The deal, which includes an arrangement in which Libya was expected to take responsibility for the bombing that killed 270 people, had been expected to trigger a UN Security Council vote as soon as early next week to permanently end the UN sanctions.
But France, a veto-wielding member of the Security Council, said it first wanted more compensation for the 1989 bombing of a UTA airlines flight over Africa that killed 170 people.
A French Foreign Ministry statement expressed "delight" at the Lockerbie compensation deal, but added: "In the interest of fairness, we would like a complementary settlement to be made very rapidly between Libya and eligible parties among families of the victims of the UTA flight.
"It is clear that such a solution is, for France, an essential condition for the definitive lifting of sanctions against Libya," the statement said.
Ministry officials would not say if this meant France would go as far as to veto a UN vote to end the sanctions, as it has been urged to do by a group representing families of the victims of the 1989 UTA attack.
But US officials in Washington said France - which angered the Bush administration earlier this year when it refused to support the invasion of Iraq - had threatened in private to veto any resolution if it did not get its way.
"They are trying to piggyback on our settlement and they are trying to blackmail the Libyans because of it," said one US official.
It was unclear on Thursday if Libya would go ahead with its side of the deal given the French position.
Libya had been expected to deliver a letter accepting responsibility for Lockerbie to the Security Council on Thursday or Friday.
But Syrian UN Ambassador Mikhail Wehbe, the council president for August, said there had been no communication from Libya's UN mission during the day on Thursday.
A Paris court found six Libyans guilty in absentia for the UTA bombing. Libya never officially accepted blame but still paid France the equivalent of €30.5 million in compensation.